Counterfeiting is a major issue across the globe, and the rise of e-commerce in recent years has further fueled growth in this industry. The fulminant rise of online marketplace like Amazon has opened new opportunities for brands and retailers, but it has also made room for counterfeiters.
As the world continues to go digital, brick-and-mortar stores are losing popularity, and most brands are taking their products online, particularly now, in the wake of the Covid19 pandemic. The numbers paint a very clear picture: a recent report by the U.S. Department of Homeland Security shows that e-commerce retail sales grew 13% year-over-year in the second quarter of 2019, while total retail sales increased by a mere 3% during that same period.
The counterfeiting industry has experienced massive growth in the U.S. in recent years, fueled by the e-commerce boom. We wanted to see how aware people are in the U.S. when it comes to counterfeiting, and what they do to protect themselves from fakes, both online and in-store. To that end, we conducted a nationwide survey to ask Americans about their shopping habits and awareness of the dangers of counterfeiting. Keep reading to see what they told us.
We kicked off our survey by asking people about their shopping habits, both online and in physical stores. When it comes to online shopping, 43% of respondents said they shopped online more than once a week, while 28% do it once a week, and 18% once or twice a month. Just 9% of respondents said they enjoyed online shopping less than once a month, and 2% said they don’t shop online.
When it comes to shopping at physical stores, 33% of respondents told us they enjoyed this activity once a week, 29% said they do it more than once a week, while 27% said they do it once or twice a month. 8% of respondents said they shopped in-store less than once a month, while 3% said they don’t usually go shopping in physical stores.
We then wanted to see how aware people in the U.S. are when it comes to the issue of counterfeiting, so we asked our respondents about it. The results are encouraging: 52% of respondents said they are very aware of the magnitude of the problem at a global level, and 40% said they were somewhat aware. However, 9% of respondents were unaware of how widespread counterfeiting is at a global level, and they admitted they had no idea how big of an issue it really is.
One of the biggest problems when it comes to fake products is that counterfeiters have become so good at what they do, that sometimes it’s hard to differentiate the original product from the replica. Consequently, many shoppers end up buying fake items without even realizing it.
We asked our respondents whether they purchased something in the past 12 months that turned out to be fake, either knowingly or unknowingly. While 47% of respondents said they did not, 35% said that yes, they did buy something that turned out to be fake. What’s more, 18% of respondents aren’t sure whether this has happened to them, precisely due to the problem we mentioned above. Counterfeit items are now of such high quality that people might not even realize that their product is not authentic.
Unfortunately, many shoppers realize that what they’ve purchased is counterfeit when it’s too late. Additionally, depending on where the purchase was made, they might not even have the right to a return or refund. Some shoppers might just not want to go through the hassle of reporting the counterfeit purchase, especially if they’re not 100% sure that their product is a replica.
We asked our respondents if they have ever reported a purchase that turned out to be counterfeit. More than 46% of respondents said they did not report such a purchase, while 23% said they’d never been in such a situation. However, 31% of respondents told us that yes, they did report a counterfeit purchase, which is encouraging news. A big part of the counterfeiting problem is the fact that many buyers don’t report or alert the authorities when they suspect they might’ve bought something that’s not authentic.
Counterfeiting is not only a threat to consumers, their health and wellbeing, but also to brands. Counterfeiting can significantly impact a brand’s profit margin, not to mention its reputation. Case in point: 56% of our respondents said they would lose trust in a brand if they bought a replica of one of their products, even if they did so unknowingly.
Next, we wanted to see how people in the U.S. evaluate the counterfeiting industry and its impact. We asked respondents where they thought counterfeiting was more common, online or in physical stores. 77% of respondents said they believe counterfeiting was more common online, while 12% believe it is a more pressing issue in physical stores. Given that e-commerce has long surpassed traditional retail in terms of sales, and more and more brands are taking their business online and downsizing their physical footprint, it’s likely that the digital realm is a lot more susceptible to counterfeiters.
We then asked respondents which industries they thought are most affected by counterfeiting. 72% of respondents believe the fashion industry is the most affected, and they aren’t wrong. Think of how many counterfeit Louis Vuitton bags, Cartier bracelets, and Alexander McQueen sneakers make the rounds online.
Electronics and cosmetics are two industries that were chosen by most of our respondents as some of the most affected by counterfeits. Other industries that respondents chose include sports goods and equipment, automotive, and over-the-counter drugs and supplements. The pharmaceutical industry is dealing with this problem as we speak, as the dangers of counterfeit tests and vaccines are very real and the global pandemic continues to evolve.
Last but not last, we wanted to see how open shoppers in the U.S. would be towards digital authentication solutions such as engage™. We’ve developed our app specifically to help end users and consumers better protect themselves from counterfeit items, with the simple use of a smartphone camera, anywhere, anytime. 40% of respondents said that if such an app existed, they would definitely use it, while 35% said they would probably use it. 19% of respondents were skeptical, and just 1% said they would not use such a solution if it were available to them.
More than 35% of respondents said they would use such an app all the time, if they could, while 31% said they would use it most of the time. This is encouraging news, emphasizing the fact that consumers are open to emerging technologies that can help them steer clear of counterfeit items. Lucky for them, we’ll be able to provide them with such technology via the engage™ mobile app, which provides instant verification and authentication of products with a simple scan with a smartphone camera.
We ran a counterfeiting-focused survey on Pollfish in early 2021, to gauge the shopping behaviors of people in the U.S., and measure their level of awareness when it comes to the counterfeiting industry.